Sale-Leaseback
Own a telehandler free and clear? A sale-leaseback converts that equity into working capital while you keep the machine on the job. $50k minimum, challenged credit reviewed.
You already own the iron. The telehandler is paid off, it's on your lot, and it's earning every week. But that equity sitting in the machine doesn't pay payroll, fund the next bid bond, or cover the deposit on the next job's materials. A sale-leaseback converts that dead equity into live capital without pulling the machine from service.
Here's how it works: we purchase the telehandler from you at its current market value, then immediately lease it back to you on a monthly payment. You get a lump sum of cash in your account; the machine never leaves your yard. You continue running it exactly as before, making monthly lease payments instead of owning it free and clear. At lease-end, depending on the structure, you can buy it back, return it, or roll into new equipment.
When a Sale-Leaseback Makes Operational Sense
The clearest use case is a contractor who has paid off equipment through years of consistent payments and now has cash tied up in the asset while the business needs liquidity for growth. A framing contractor, for instance, who owns two paid-off telehandlers free and clear, might do a sale-leaseback on one to fund a second crew's ramp-up without taking on a line of credit or diluting ownership.
Residential home builders doing subdivision work often carry a stack of owned equipment between phases of development when receivables are slow. A sale-leaseback bridges that gap. Same with concrete contractors who front-load equipment purchases early in their business and later want to recycle that capital into trucks, forms, or crew without selling the machine outright.
Sale-leasebacks also make sense after a cash-flow disruption. If a project delayed payment or a large unexpected expense hit the business, a leaseback on an owned piece of equipment restores liquidity without adding a new external obligation for new iron.
What We Look For in a Sale-Leaseback
The machine has to have clear title and sufficient market value to support the transaction. We fund telehandler leasebacks from $50,000, which puts mid-range telehandlers squarely in range. A $100,000 to $130,000 paid-off construction telehandler from a major brand delivers a meaningful capital injection with a manageable lease payment.
Machine age and hours matter more in a leaseback than in a straight loan because the lessor is acquiring title and must be confident in the machine's remaining useful life and remarketing value. A well-maintained JCB or Manitou with under 3,000 hours typically qualifies without issue. Higher-hour machines can still qualify, but the advance rate may be lower to reflect the residual risk.
We need three months of bank statements, the machine's title or most recent registration, a brief service history or condition overview, and a one-page application. We will order a valuation or desk appraisal to confirm market value. The whole process from submission to cash in your account runs one to two weeks for clean deals.
Leaseback Payment and Term Structure
The monthly payment on a leaseback is a function of the purchase price (what we pay you for the machine), the lease rate, and the term. A 36-month leaseback on a $100,000 machine will carry a higher monthly than a 60-month leaseback on the same machine. The tradeoff is how much total cost you pay over the life of the leaseback versus how much you reduce the monthly obligation.
At leaseback end, you typically have the option to purchase the machine at fair market value, return it, or roll into a new unit. Dollar buyout leasebacks are also available, where the $1 buyout at end essentially guarantees you get title back. That structure has a higher monthly but eliminates the end-of-term residual uncertainty.
The capital you receive at closing is not a loan in the traditional sense. It comes in as the proceeds of a sale. Depending on your tax situation and the machine's basis, there may be a gain recognition event. Talk to your tax advisor before signing. For most operators with full basis remaining, the tax impact is manageable.
Sale-Leaseback Questions
Common Questions on Sale-Leaseback
Straight answers before you send the equipment file.
Can I do a sale-leaseback on a telehandler that still has a lien on it?
If there is an existing lien, the payoff must be satisfied at closing, typically from the sale proceeds. If the machine is worth more than the payoff, you receive the net difference. If it is underwater, a straight sale-leaseback is difficult. In those cases, an equipment refinance or cash-out refinance may be a better fit depending on your equity position.
Does a leaseback affect my ability to finance other equipment?
A leaseback adds a monthly obligation to your balance sheet, which affects debt service coverage ratios that lenders review when you apply for additional financing. However, the cash you receive from the leaseback often improves your liquidity ratios at the same time. Net effect depends on your specific financial position.
How is the purchase price determined in a sale-leaseback?
We use market data, published equipment value guides, and condition assessment. The advance rate is typically 80 to 90 percent of appraised market value for clean, low-hour machines from name brands. High-hour or older units may be advanced at a lower percentage.
Can I do a leaseback on multiple telehandlers at once?
Yes. A portfolio leaseback on two or more machines can often be structured as a single transaction, which simplifies documentation and sometimes improves the aggregate advance rate. If you own multiple telehandlers free and clear, let us know the full list and we will assess the whole portfolio.
What happens if the machine needs major repairs during the leaseback term?
As the lessee, you are responsible for maintaining the machine in working condition. Major mechanical expenses during the lease term are your cost to bear. This is standard across sale-leaseback structures. Factor maintenance reserves into your cash-flow planning when evaluating the leaseback.
Get Terms on Sale-Leaseback
Tell us what you are buying, who is selling it, and when you need it earning. We will review the file and point you to the next step.